Job cuts in the steel industry: Thyssenkrupp-Stahl wants to cut thousands of jobs

Germany’s largest steel company, Thyssenkrupp Steel Europe, plans to cut several thousand jobs in the coming years. The company announced that the number of jobs will shrink from the current 27,000 to 16,000 within six years.

According to this, around 5,000 jobs will be cut by the end of 2030 through “adjustments in production and administration”. 6,000 additional jobs are to be outsourced to external service providers or business sales.

Personnel costs are also expected to be reduced by an average of ten percent in the coming years. This is one of the key points for an industrial future concept. IG Metall rated the project as a “clear-cutting” that would be “a catastrophe” for the employees and the industrial location of North Rhine-Westphalia.

With the concept, the company, which is majority owned by the industrial group Thyssenkrupp, is reacting to the weak demand. Production capacities are to be reduced from 11.5 million tons per year to just 8.7 to 9.0 tons. This corresponds to the shipping volume of the previous financial year. ·As part of the realignment, the declared goal remains to avoid redundancies for operational reasons.

The aim is to create long-term prospects for as many employees as possible, says Thyssenkrupp’s steel boss Dennis Grimm. Therefore, we will adapt to the changed market conditions through targeted capacity adjustments and cost reductions. “In order to position ourselves for the future, a comprehensive optimization and streamlining of our production network and our processes is necessary.”

Closure of the Kreuztal-Eichen site

An essential element in the necessary capacity reduction remains the separation from Hüttenwerke Krupp Mannesmann (HKM), it said. The primary goal is to sell the company shares in HKM. If a sale is not possible, Thyssenkrupp Steel will hold discussions with the other shareholders about amicable closure scenarios. In addition, according to the information, the processing site in Kreuztal-Eichen is to be closed. 500 employees work there.

Steel division should go its own way

In parallel to the savings program, the parent company Thyssenkrupp wants to push ahead with the independence of the steel division. The Czech energy company EPCG, owned by Czech billionaire Daniel Kretinsky, currently holds 20 percent, and in the next step this share is expected to increase to 50 percent.

Green steel plant is to be further built

Germany’s largest steel company has been under pressure for a long time, cheap imports from Asia, high costs and weak demand have led to loss-making business. In the interests of climate protection, high investments are also necessary to improve the CO2 balance of energy-intensive steel production. In Duisburg, “green steel” is to be produced with hydrogen in the future; the federal government and the state of North Rhine-Westphalia are funding an expensive new plant with a total of two billion euros.

Despite the state’s strong financial injection, the project is an expensive affair for Thyssenkrupp Steel. According to media reports, internal consideration was given to exiting the project. The company is now emphasizing that it is sticking to its plan to complete the direct reduction plant that is already under construction. At the same time, “constructive discussions” are being held “to ensure the economic viability of this large investment project under the rapidly changing conditions.”

Sharp criticism from the union

IG Metall district manager Knut Giesler, who is deputy chairman of the supervisory board of Thyssenkrupp Steel Europe, said: “Anyone who wants to cut over 11,000 employees and close a location must expect bitter resistance from IG Metall.”

He complained that there was no waiver of redundancies and site closures for operational reasons. “These are exactly the red lines that we have communicated again and again.” Regarding the planned cuts in personnel costs, Giesler said: “Anyone who comes up with such ideas in times of a shortage of skilled workers has understood nothing.”